South Korea’s inheritance tax sparks millionaire exodus
Rigid inheritance laws blamed as 2,400 wealthy residents leave the country. Business group seeks reforms including tax payment via stocks
South Korea has emerged as one of the countries experiencing the world’s largest outflow of wealthy individuals, in part due to its rigid inheritance tax system.
A recent analysis by British consultancy Henley & Partners showed on Tuesday that the net outflow of Korean millionaires last year was estimated at 2,400, double the 1,200 recorded in 2024. The figure was the fourth largest globally, following the United Kingdom, China and India.
“Korea’s inheritance tax rate of up to 60 per cent may have been the main factor accelerating the migration of capital,” a Korea Chamber of Commerce and Industry (KCCI) official said.
With the National Assembly having suspended discussions on legislation to ease the world’s highest inheritance tax rate, the business association forecast that Korea’s inheritance tax revenue could reach 35.8 trillion won (US$25 billion) by 2072, up from 9.6 trillion won in 2024.
That projection stems from a steady increase in those subject to inheritance taxes, caused by repeated delays in legal revisions and the rising number of people dying at older ages.
“Heavy inheritance taxes have weakened corporate investment, put downward pressure on stock prices and forced the sale of controlling stakes,” said Kang Seog-gu, executive director of the KCCI’s research division.